Alex Azar is getting busy & other healthcare headlines

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It's not even Thanksgiving, and we've already broken out the snow boots and shovels. While the New York area was nearly gridlocked from last week's snowstorm, our team was not. In fact, we’re pretty darn busy with a flurry of healthcare news.

Let’s explore some great and not-so-great moments in this week’s healthcare news -- from setting off a chain of selfless acts to Alex Azar’s busy week. Oh, and for history buffs, today represents one of the greatest communications anniversaries of all time. If you can’t guess what it is, we reveal more below.

Happy Monday, happy reading and Happy Thanksgiving!

Pay a Kidney Forward? Remember the movie Pay it Forward? Well, the National Kidney Registry figured out how to do that with organ donations from people who want to donate a kidney to a loved one that may need it in the future, but who will age-out of being able to do so before that time comes. “Transplant chains” enable live donors to share a kidney with a stranger now, but arm their loved one with an immediate kidney voucher years later, if they need it.

Millennials on drug prices in DTC: How will the Administration's proposed rule to include drug prices in ads fare in reality? According to Wells Fargo Securities – seniors are looking forward to it, and for millennials, it doesn't even register. Seventy-seven percent of seniors think pharma should be required to disclose prices in ads, but only 40% of 18 - 24 year-olds think the price should be included. However, that doesn't come as much of a surprise, considering how few ads reach millennials—that ever-elusive demographic—in the first place.

ICYMI: Facebook’s C-SUITE = Crisis Corner: The New York Times published an excoriating investigation of Facebook leaders handling of multiple crises facing the social network, from Russian interference to data sharing to hate speech — all culminating in a Congressional inquiry last summer and consumer backlash. Despite well-scripted public apologies and a reputational repair ad campaign, The Times revealed a campaign-style disinformation campaign with PR tactics aimed at implicating other tech companies like Google and YouTube. YIKES. It’s never a good sign when your lobbying and PR defense are front page news!

Mango, cucumber, and crème (HINT: We’re not talking about a mixed drink or a seasonal Frappuccino from Starbucks). Juul Labs will no longer sell most of its flavored nicotine pods for electronic cigarettes in retail stores and is shutting down social media marketing of Juul pods. Flavor cuts include mango, fruit, crème, and cucumber (which account for nearly half of retail sales). The move comes as the FDA is cracking down on a teen “vaping” epidemic. And just last week, Commissioner Gottlieb also proposed a ban on menthol cigarettes.

►CMS IN THE HOUSE

HHS has sure as heck been making some moves – and keeping us busy this week. From expanding mental health coverage to pay for short-term psychiatric residential treatment to allowing Medicare Advantage plans to start paying for health-related benefits like transportation and home health visits to seniors, HHS Secretary Alex Azar and CMS Administrator Seema Verma have been making the rounds. Here’s what you should know:

Mental health: CMS is considering demonstration waivers for State Medicaid programs. The waivers will cover short-term stays for acute care provided in psychiatric hospitals or residential treatment centers in return for states expanding access to community-based mental health services. The newly allowed services may expand care for children with serious emotional disturbance and adults with serious mental health illness.

Senior care: Some Medicare Advantage plans (plans offered by private companies which are approved and paid for by Medicare to cover seniors’ medical insurance), will be enabled to cover transportation to the hospital and home-care. The aim is to keep seniors out of hospitals and improve health outcomes. Sec. Azar says that by 2020, this may expand to home modifications and home-meal delivery. Kaiser Health News says don’t get too excited, only 7% of Medicare Advantage members will likely be eligible.

Michigan gets a waiver: CMS also announced approval for Michigan to pursue a drug pricing “experiment.” According to Verma, Michigan’s Medicaid program will be allowed to offer additional rebate agreements for "outcomes-based" contracts with manufacturers. This is the

►OUR TAKE

With elections over…well, almost over… the Administration is hitting the gas pedal on a number of proactive programs to better right-size federal resources to prevent costly hospitalizations, and factors that lead to them – including non-healthcare costs. That’s right, folks, Sec. Azar has forecast programs that help address the “social determinants of health” which, in the future, may include nutrition programs for diabetics, and even housing for those with unstable housing.

Many of these programs are specifically being considered for the Medicaid program, which was the cause of significant federal government dollars flowing to the states. Both drug spending and state spending has been on the rise in the last ten years, so expect to see more interventions there.

►ANALYSIS ON SPENDING? OR ANALYSIS PENDING?

Axios released a report this week: “Pharma's grip on the health care economy.” The site reviewed corporate financial documents of 112 publically-traded healthcare companies and showed that “ten companies controlled half of the healthcare industry's $50 billion of global profit in the third quarter of this year.” Ninety percent of those in the top 10 were pharmaceuticals. Moreover, Axios says, while Americans spend most of their healthcare dollars in hospitals and on physician care, drug makers earn a lot more profit on their share of healthcare revenues. It added that under the Trump Administration’s corporate tax cut some companies are paying an effective tax rate of just 0.5%.

►OUR TAKE

The Axios investigation has some eye-brow raising flaws. For example, comparing global manufacturing companies to hospitals is like comparing apples and oranges. They are entirely different services and business models. But, we may be witnessing a preview in the next salvo against the industry’s reputational challenge. Healthcare is an undeniably large portion of this nation’s GDP, and we expect to see critics of the industry ask the question “What is responsible profit?” Regardless, its clear pharma companies have much work to do to set the context surrounding their profits. And it’s harder for them. Individuals have an emotional connection to the people that provide them care, and much less so to the companies that manufacture the medicines that help care for them. That’s a hard battle to win. What to do? It’s time to start showing facts and figures illustrating that revenues are not just going to shareholders. In fact – a lot of that money is going to the very hospitals that are caring for individuals, the economy, research funding, and other initiatives. It’s time to start showing a broader story than R&D, or expect more criticism to come!

And finally, if you haven't guessed the answer to this week's headline, we'll give it to you. On November 19, 1863, Abraham Lincoln delivered the Gettysburg Address. Initially, the speech garnered mixed responses mostly due to its brevity, but the powerful language has stood the test of time!

And that’s it for us until December. You weren’t expecting to read TWTW in your tryptophan-based food coma, were you?